The U.S. Trade Representative said on Thursday it has added Pinduoduo.com, China's third-largest e-commerce platform, to its 'notorious markets' list for a proliferation of counterfeit products, as the agency also called out China as a priority to watch for intellectual property rights concerns.

In its annual review of trading partners' protection of intellectual properties rights and so-called 'notorious markets,' the U.S. Trade Representative said 36 countries warranted additional bilateral engagement over these issues. The agency kept China on the list and lifted Saudi Arabia up as a priority.

The release of the report comes as the United States and China are embroiled in negotiations to end a tit-for-tat tariff battle that has roiled supply chains and cost both countries billions. The two countries are due to resume talks in Beijing next week.

USTR also kept Alibaba Group's taobao.com on the 'notorious' list, even though the parent company has 'taken some steps' to curb the offer and sale of copyright infringing products, according to the report.

The agency bumped Saudi Arabia up to priority in part due to an illicit service for pirated content called BeoutQ, the report said.

Despite 'extensive engagement' in Saudi Arabia by both U.S. government and private stakeholders, treatment of intellectual property rights 'continued to deteriorate,' USTR said.